Question
What is the name of your state?What is the name of your state? South Carolina
My husband was fired from his job on August 17, 2005. Since the health insurance is paid a month in advance, we assumed we had coverage for at least the remainder of August. When I filled a prescription for my son on 8/25/2005 I found out the coverage was cancelled. I checked the insurance company’s web site which showed coverage was cancelled on 8/17/05, the same day he was fired. He had two paychecks after the date the insurance was cancelled and the company deducted insurance from both checks. One is dated 8/19/05 and the other 8/26/05. Are we entitled to the insurance being extended or having the deductions refunded?
Answer
Possibly. It depends upon whether or not the insurance deductions represent payments going forward or not.
For example, if an employee began their insurance coverage on day one of his employment, he gets his first paycheck and it has the insurance deduction. Okay, fine. But he's already been covered by the insurance for, say, two weeks. Does the deduction from his first check cover the two weeks already worked, or is it for the next two weeks going forward?
So when that same employee has an insurance deduction taken out of his final check, it could conceivably be thought to "wash" out the two weeks "free insurance" he got when he joined the company.
Answer
I think the definitive answer will be found in the plan book. The plan book will / should define precisely when an employee / dependants are no longer eligible for benefits. Regardless of premium payment, the plan book definition of eligibility for benefits will rule. If the participant has over paid, the participant will be entitled to refund of premium. I.E. premium payment is only one aspect of eligibility for benefits. (Assumes the plan book is in compliance with any applicable state and federal regulations.)